Google’s revenue for the three months to Dec. 31 came in at US$10.58 billion, up from $8.44 billion a year earlier, the company announced Thursday. Subtracting commissions and fees paid to partners, revenue was $8.13 billion, below the consensus analyst forecast of $8.41 billion, according to Thomson Reuters.
Its net income before one-time charges, at $9.50 a share, was also below the consensus estimate, which called for $10.50 a share.
Google’s shares dipped 9% in after-hours trading, to $583.48 at the time of this report, as investors reacted to the news. Earlier, Google’s stock ended the regular trading day up 1%, at $639.57.
CEO Larry Page was upbeat. “Google had a really strong quarter ending a great year,” he said in a statement.
It’s Google+ social networking service now has 90 million users, Page said, up from about 40 million when Google reported its third-quarter results a few months ago.
Android use is also growing, he said later on a conference call. There are 250 million Android devices in use, up 50 million from November, and 11 billion apps have been downloaded from the Android store, Page said. Google already makes money from Android through ad sales and sees “a lot of potential” to make more money in the future, he said.
Oracle also sees potential to make money from Android, however; it’s accused Google of misusing patented Java technology in the mobile OS and is seeking billions of dollars in damages. Google denies any wrongdoing.
Google’s ad revenue also increased. Display ads, not a strong point for the company traditionally, are now producing revenue at an annual rate of $5 billion, Page said. Paid clicks, a measure of how often people click on Google’s ads, were up 34% year over year. But the average cost per click, or how much advertisers pay for those clicks, dropped by 8%, Google said.
Google shut down a dozen or more services last year, Page noted, which will help it to focus its business and “double down on really big bets” such as Chrome, Android and YouTube, Page said. It will keep developing new services, but instead of launching “hundreds” over the next few years, it may launch “just a few,” he said.